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Competition Commission makes 21 charges against Takata SA

Global airbag and seatbelt manufacturer Takata Corporation and its local arm‚ Takata SA‚ will now face 21 charges after the Competition Commission referred additional cases of collusive tendering‚ price fixing and market division.

The commission has added 17 more charges following the initial four that were referred to the Competition Tribunal for prosecution in March this year. The initial charges in March related to tenders issued in 2007 and 2008 for airbags, seatbelts and steering wheels fitted to certain BMW, Honda and Toyota vehicles sold in SA. Just four vehicles were involved in the first investigations, but a statement released by the commission on Monday advised that a further 25 model derivatives have now been added. These include models such as the Audi A6, BMW X5, Porsche Cayenne and Volkswagen (VW) Polo.

"The cartel on car parts is one of the most extensive global cartels affecting most vehicle models and, therefore, a significant number of consumers globally‚ including SA‚" said Competition Commissioner Tembinkosi Bonakele.

"The affected vehicles are among the most popular in our market. Its effect would have been an increase in the prices of affected motor vehicles," he said. "The uncovering and prosecution of this international cartel confirms the commission’s position as one of the elite global anti-cartel enforcers."

The latest charges involve collusion in relation to BMW‚ Toyota and VW tenders issued between 2006 and 2011 for the manufacture and supply of:

It is unclear at this stage if any models were manufactured in SA, particularly the BMW 3 Series and VW Polo. However, the commission has the power to investigate and lay charges related to all products sold in SA, not just those manufactured here.

No automotive manufacturer has been implicated in any of the charges however, with Sipho Ngwema, head of communications for the Competition Commission, stressing that the automakers are “the victims” of the actions undertaken by Takata, its subsidiaries and partners.

Those partners were Autoliv and its South African subsidiary, as well as TRW Automotive and TRW Occupant Restraints SA. Autoliv settled with the commission in 2017, paying a R150m fine, while the two TRW companies applied for leniency after providing information for the investigation.

Takata, which filed for bankruptcy protection in the US in 2017, has been taken over by Key Safety Systems (KSS). In March, the commission approved the takeover of Takata SA by Jolyon KSS Automotive SA “subject to conditions that will ensure the preservation of any claims it may have against Takata in the event that an administrative penalty is levied against Takata.

The next stage will be an exception hearing on July 23 2018, but a spokesperson for the Competition Tribunal has advised that no firm date has yet been set for the full hearing into the matter.

The Commission is looking for a fine of 10% of Takata’s global revenue at the time of the offences, which could run into the billions of rands.​